Announced Actions for June 19, 1998

For Your Information

June 19, 1998

Consent agreements given final approval: Following a public comment period, the Commission has made final consent agreements with the following entities. The Commission action makes the consent orders binding on the respondents.

A consent order against Civic Development Group, Inc. and Community Network, Inc. and individual officers of each organization will prohibit them from engaging in deceptive charitable solicitations on behalf of local law enforcement agencies. Civic Development and its principals, Scott Pasch and David Keezer, and Community Network and its officer, Richard McDonnell, are prohibited from misrepresenting, in any way, how or where a solicited charitable donation would be used. The settlement also requires both organizations to set up an education and monitoring program for employees. The Commission vote to make the order final was 3-0, with Commissioner Orson Swindle not participating. Commissioners Robert Pitofsky and Sheila Anthony issued a joint statement. Commissioner Mozelle W. Thompson issued a separate statement. (See news release dated March 18, 1998; Docket No. C-3810; Staff contacts are Eileen Harrington, 202-326-3127, or Hugh Stevenson, 202-326-3511.)

As part of a final order against Degussa Corporation and its parent company, Degussa Aktiengesellschaft, the company has agreed to acquire E.I. du Pont de Nemours & Co.'s Gibbons Plant in Gibbons, Alberta, Canada, and to limit to one percent its acquisitions of the stock, equity or other interest in DuPont's plants in Memphis, Tennessee, and Maitland, Ontario, Canada, without the Commission's prior approval. In addition, Degussa has agreed to limit to one percent (or for investment purposes, five percent) its acquisitions of the stock, equity or other interest in the manufacture, distribution or sale of hydrogen peroxide in North America without prior notification to the Commission. The Commission vote to make the order final was 4-0. (See news release dated March 30, 1998; Docket No. C-3813; Staff contact is Joseph G. Krauss, 202-326-2713.)

Consent agreements with Mega Systems International, Inc., Jeffrey Salberg and Howard Berg, settling charges that advertising claims made in radio and television infomercials were false and unsubstantiated. Under the terms of the agreement, Mega Systems and Salberg will pay $500,000 in consumer redress and will be required to disclose "THE PROGRAM YOU ARE WATCHING IS A PAID ADVERTISEMENT FOR [THE PRODUCT OR SERVICE] in television ads that are at least 15 minutes long, and to disclose the same audio message in radio ads that are at least five minutes long. In addition, Mega Systems, Salberg and Berg will be barred from making deceptive claims relating to their products in the future. Salberg and Mega Systems will be required to have substantiation, which, when appropriate, must be scientific, for claims about the benefits, performance or efficacy of any product or program they advertise; promote; sell; or distribute in the future. They also will be barred from misrepresenting the existence, contents, validity, results, conclusions or interpretations of any test, study or research. Berg will be required to have scientific substantiation for claims about the benefits, performance or efficacy of any product or program like those he allegedly deceptively promoted. The agreements also contain record keeping and reporting provisions to allow the Commission to monitor compliance. The Commission vote to make the Salberg order final was 5-0, and the vote to make the Berg order final was 5-0. (See news releases dated January 13, 1998; April 17, 1998; Docket Nos. C-3811, Salberg; C-3812, Berg; Staff contacts are C. Steven Baker or Russell W. Damtoft, 312-960-5634.)

Copies of the documents referenced above are available from the FTC's web site at http://www.ftc.gov and also from the FTC's Consumer Response Center, Room 130, 6th Street and Pennsylvania Avenue, N.W., Washington, D.C. 20580; 202-FTC-HELP (202-382-4357); TTY for the hearing impaired 1-866-653-4261. To find out the latest news as it is announced, call the FTC NewsPhone recording at 202-326-2710.